Palantir (PLTR) Drops 3.26% Amid Valuation Concerns

On August 20, 2025, Palantir's stock experienced a 3.26% drop in pre-market trading, reflecting a continuation of recent volatility and investor concerns.

Palantir's stock has been under pressure due to a combination of factors, including sector-wide profit-taking and renewed valuation concerns. The company's shares have been particularly volatile, with significant price movements over the past year. This volatility has been exacerbated by the actions of high-profile short sellers who have expressed worries about the stock's elevated valuation.

Despite these challenges, Palantir has reported strong demand for its artificial intelligence platform, with its U.S. business growing significantly year-over-year. The company's commercial revenue in the U.S. surged 93% in the second quarter of 2025, indicating that its AI adoption is scaling structurally rather than episodically. This growth highlights the potential for Palantir to continue expanding its market presence and driving revenue growth.

However, the recent sell-off in Palantir's stock suggests that investors remain cautious about the company's valuation and future prospects. The stock's volatility and the actions of short sellers have contributed to a week-long slump, with shares falling for five consecutive sessions. This trend underscores the need for Palantir to address investor concerns and demonstrate sustained growth in order to regain market confidence.